Reverse logistics saves Michelin six-figures in tyre disposal costs
Michelin has embarked on a nationwide reverse logistics drive for its used tyres in the UK, resulting in massive cost savings for its waste disposal operations.
In 2009 the tyre manufacturer set up a project team of senior managers from its manufacturing, logistics and commerce arms together with its official retail partner ATS Euromaster to take back all of its end-of-life tyres and manage the recovery process in-house, rather than rely on sub-contractors.
By backhauling used tyres back to Michelin's two warehouse operational hubs for sorting and onward disposal, the company is not only managing its recovery operations better, but has reduced disposal costs by a six-figure sum.
The reverse logistics operation has also enabled more frequent collections, freeing up storage space at ATS outlets. There have also been marginal cost improvements from maximising group assets.
Michelin's UK operations manager Neil Walker told edie that the company saw a big opportunity to streamline its sub-contractor base and control waste arisings better.
"By taking these tyres back to our own licensed premises, we were able to halve our disposal fee and make a six-figure saving in total," he said.
The scheme forms part of a wider corporate sustainability drive at Michelin, the full interview of which can be read here